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Friday, August 7, 2020

HH calls for Drastic Reforms at DBZ and CEEC, after report show Zambia is in Top League in terms of Entrepreneurial Appetite

Headlines HH calls for Drastic Reforms at DBZ and CEEC, after report show...

UPND President Hakainde Hichilema
UPND President Hakainde Hichilema

United Party for National Development (UPND) leader Hakainde Hichilema has called for drastic reforms at the Development Bank of Zambia (DBZ) and the Citizens Economic Empowerment Commission (CEEC), and the pension funds that have money sitting idle.

Taunting a report that showed that Zambia and Nigeria are the two leading African countries in terms of entrepreneurial appetite, Mr. Hichilema said that many entrepreneurs lack in Zambia lack a package for their businesses to grow and offered a practical advise on how the PF Government can implement the ideas he is suggesting.

Below is his full post

It does not come as a surprise that Zambia and Nigeria are the two leading African countries in terms of entrepreneurial appetite.

We know that Zambians are very enterprising. What many entrepreneurs lack, is a package for their businesses to grow. It is a known fact that over 50% of formal employment in the world is created by SMEs. These are major contributors to GDP and taxes that run most economies. In Zambia over 88% of all formal jobs are in SMEs, they also contribute 70% to GDP. Making this a huge sector and engine of the economy.

Our plan for this sector is very simple. Firstly, the major problem with SMEs is access to financing. This is the reason if the current Government is serious about unlocking the sector, they should reform DBZ and CEEC into venture capital institutions (I will explain this further below). Secondly, the Government must not just sign MOUs with foreign Governments like the much talked about Israel and India MOUs, but should actually sign contracts for the supply of goods and services. This is called market linkage which an SME cannot do on its own. The third dimension is what we call contract discrimination, here is an example, a road contract has various components, technical and material supplies. We have been told that 20% contract value of any project must be given to the local contractors. I disagree and suggest an alternative; what if we exclude certain elements like the supply of cement, the supply of stones, the supply of steel for instance during road construction to be exclusive for Zambians, that would have more impact than an arbitrary figure.

Let me talk about financing again. I am suggesting to PF to carry out drastic reforms at DBZ and CEEC and the pension funds that have money sitting idle sometimes. DBZ and CEEC must take the form of venture capitalists, where they finance Zambian start-ups and SMEs and they own shares in those companies and appoint management to those companies. This way they will ensure that they are part of the day-to-day decision-making process. While ZDA can be transformed into a proper Business Development Service outfit that could be the institution that looks for business opportunities for start-ups and SMEs to give them the necessary boost.

Lets talk fellow countrymen, these are ideas anyone can pick, irrespective of who is in Government.

42 COMMENTS

  1. He is wasting his time because No walahi. All that matters is that come 2021 vote share will be: EC Lungu- 80% HH- 5%, others : 5%.

    • One more question my president, how do we turn Zambia into a Tax haven? So that everyone else hides there monies in Zambia.

  2. We should explore the possibility of the few Zambians empowered to create wealth within as opposed to hiding money off shore until uncovered by Panama

  3. kaiza where do you come up with those #s. how will pf get 80% of the votes? whom are you talking to that tells you that the majority (80%) of Zambian voters are happy with the pf?

    • The zambian people vote based on performance and development. Look around Zambia and see the infrastructure development and rising middle class we have created. The people will thank us at the polling booth

    • #3.1. My foot! Any so called infrastructures without production is a waste of resources.

      By the way, did you see yesterday’s flooding at Mumana? That’s your infrastructure?

    • It’s not our infrastructure. It is the effects of nature that we have no control over. We cried for the rains ,now the rains are here you are still complaining. We can’t please everyone all the time. Our next project is to find ways of tapping into urban area rainfall and diverting it to where it is most needed.kz

  4. This is what you should be doing sir. Zambia belongs to everyone. Be consistent with this and when the nation is looking for alternative leadership they will come for you sir. Those insulting HH are hypocrites and unpatriotic. When he attacks PF you say he is bitter, he provides guidance and advice you start talking about 2021. Zambia is for everyone and anyone can become president. Personally I will respect anyone in state house and those aspiring to be in state house as long as they do it in a mature manner without endangering the peace of the nation. Please keep it up HH.

  5. Pardon…..Pension funds have funds sitting idle…….?

    Are they the same that don’t pay when it’s time because ……..inflation etc. etc

  6. For most readers you first begin to define What a venture capital is for them to understand and relate to the current set and investments policy statements of DBZ and CEEC and make a distinction between DBZ CEEC investments policy statements and the need for the formation of Small Business Investments company or venture capital with those risks and returns profiles and investments horizons typical of venture capital As it is now DBZ and CEEC are well thought and crafted perhaps what neds to be done is to create a new SIDO to buy in either in equity or debt those innovative those growth oriented ideas in start-ups without taking focus away from DBZ and CEEC mandates Vcs…

  7. Vcs normally will stake and participate to take and assume above risks for above normal returns normally outside the normal funding operations of either DBZ or CEEC Its risk capital hoping to make a return over a long-term and funds like DBZ and CEEC are supposed to be invested in a preservative manner and to ensure all with innovative ideas have a chance to access without the capital base being eroded by risk and often untested innovative ideas The funds operate on a conservative approach to growth the capitalisation or book as more empowered contribute to the funds There are often significant risks and uneven cash flows in most funded Vcs ideas and the Cost of capital is often onerous to…

  8. the individuals exposed to Vcs Investments Its only suitable for funding costly ventures with hue capital outlay and therefore outside the scope of CEEC and may be DBZ and possibly for IDCs The high risks, lack of liquidity and close out makes them unattractive methods of actualizing what is in appetite for Zambians and Nigerians as reported The conditions also attached makes those innovative start-ups to foreclose on their business plans and fail to consummate to live for long-term and sometimes the due diligence and requirements to access Vcs for most of our Financially challenged yet innovative business entrepreneurs is disadvantageous Then also the need for policing by…

  9. by Vcs in levered by either DBZ or CEEC removes that flexibility from those enterprising innovative It could be potentially expensive especially with expertise that needs to supervise those ideas There are cases of failed and successful starts and better funding methods than Vcs

    What you need to and need to be done if that is the route is to make use of already ministry of commerce expertise in small business administration or SIDO with funding from CEEC or DBZ This expertise in OPPI and PPIs already exists and supports various funds methods and business starts from youth to CEEC to DBZ funded

    If you have to go the way of Vcs then you will need to expand the…

  10. No problem can be solved from the same level of consciousness that created it – Albeit Einstein

    Rich people in Western countries pull entrepreneur youths to make a difference. Trump came with The Apprentice; UK came up with The Dragon’s Den. HH came up with his own political ambition.

    • The Apprentice is a TV business reality show created by British journalist Mark Burnett. It is a Franchise broadcast in a number of countries. Trump was just a presenter for the American version. He never created it. You can tell your ZNBC to pay franchise fees to Mark Burnett and you will have your own show. And isn’t Trump a politician just like HH? A lot of the criticisms of HH lack merit. They are very idi. o-tic. HH will decide what to get involved in. He has a life and ambitions to fulfil. Worry about your own ambitions , if you have any!

    • The Apprentice is a TV business reality show created by British journalist Mark Burnett. It is a Franchise broadcast in a number of countries. Trump was just a presenter for the American version. He never created it. You can tell your ZNBC to pay franchise fees to Mark Burnett and you will have your own show. And isn’t Trump a politician just like HH? A lot of the criticisms of HH lack merit. They are very idi. o-tic. HH will decide what to get involved in. He has a life and ambitions to fulfil. Worry about your own ambitions , if you have any!

  11. the Investments mandate of the r CEEC and DBZ funds and create a Small Business Investments Company to Venture and arbitrage into those innovate and sometimes risk ideas for those hitching Zambian entrepreneurs The Small Business Investments Company will almost like its is mirror the IDC and will be capacitated with all capabilities to support Vcs

    Good attempt and thought provoking and comments are not political but simply a review and observations

  12. correct its about preservation of capital and investing wisely to have longevity of the funds and perpetuity Vcs are risky and the return could be not risk adjusted always especially that the ideas may not be proven as per business plans and environments
    He will need to propose other funding ways and innovations not yet tried to actualize the SMEs access to capital and much needed capital His reasoning also must be consistent when he is talking this and national accounts and parities also

    The policies as they are are currently existing are correctly thought out and no e inventing the wheel but build on to add a small business investment company and assign proper metrics and SMEs…

  13. Zambia will never get ahead if we continue to put politics ahead of logical policies and issues.Give HH his due even if you don’t like him.

  14. This entrepreneurial verve ought to supported by government so as to grow the economy and sustained development as opposed to contracting works to foreign companies who take away foreign exchange. The money goes to create jobs in those countries while we suffer unemployment and its ill – effects.

  15. HH is the only Presidential Candidate who has been tested for Authenticity. He is the real deal, unlike the current president who stumbled upon the job as an opportunist with no vision for the country. Despite unfair treatment by PF government, he has held on. His support base is increasing by the second and PF and their cadre mentality are in for a rude shock when most of them will spend the rest of their lives in prison. HH has shown consistency both in his business life and politics and clearly the only level headed person to lead this country into prosperity. The PF government is bent on only winning the elections and not concerned about the impact the debt they have piled up will have to our future generations. Kaizar Zulu has the temerity to brag about the misplaced priorities for…

  16. Kaizar Zulu has the temerity to brag about the misplaced priorities for infrastructure in the country.. How dare you. There are so many educated but unemployed youths who can have a positive contribution to this nation PF had good priorities for Zambia..HH’s view above makes sense.

  17. HH is the only Presidential Candidate who has been tested for Authenticity. He is the real deal, unlike the current president who stumbled upon the job as an opportunist with no vision for the country. Despite unfair treatment by PF government, he has held on. His support base is increasing by the second and PF and their cadre mentality are in for a rude shock when most of them will spend the rest of their lives in prison. HH has shown consistency both in his business life and politics and clearly the only level headed person to lead this country into prosperity. The PF government is bent on only winning the elections and not concerned about the impact the debt they have piled up will have to our future generations. Kaizar Zulu has the temerity to brag about the misplaced prioritie. Shame

  18. Kaizar Zulu has the temerity to brag about the misplaced priorities for infrastructure in the country.. How dare you. There are so many educated but unemployed youths who can have a positive contribution to this nation..HH’s view above makes sense.

  19. HH last time was talking about employment now he is talking about SMEs.The question is how is hh going to employ the youth especially those who have just left school? secondly, if there is money sitting idle and hh as been singing a song that this govt is bankrupt how come it as idle money sitting some were,why confusing the Zambian people.Stict to your points bo hh.

  20. #21 Zambia in the Sun: “HH is the only Presidential Candidate who has been tested for Authenticity. He is the real deal, unlike the current president who stumbled upon the job as an opportunist with no vision for the country. ”

    But the only authentic thing about Trible HH is that he took over from Andy in 2006 in Choma by trible force. He has confirmed his trible agenda by not apologising to the nation for that, and whenever he has felt overconfident he actually comes out in the open about it. All those trible running mates that he has chosen and will continue to choose are window dressing and further confirmation.
    Look here, trible HH is just as bad as Hamble for their own which we all know. Best for Zambia is to show both the door.

  21. Hmmm, the supposed wisest economic mind in Zambia. Whether reforms are due at this institutions, the real problem is that Zambians can’t walk into banks and other financial institutions because interest rates are too high, to borrow locally their businesses will collapse. Hh fails to convince me that he has genuine intentions to serve this country.

  22. Kaizer keeps talking about infrastructure. Look man we are not saying infrastructure development was a bad idea by PF, it was just wrongly executed with the wrong funding. You see kaizer it’s about setting priorities that keep complementing or keep a smooth flow with others that follow. For example when you borrowed all those billions of dollars you should have started by firstly investing in key ventures or sectors that actually generate income so as to expand income base or increase income streams. Doing that would have helped the PF pay back the loans and use the excess income to develop infrastructure. Do roads or buildings generate income? No. It’s simple roads are simply aids to trade thereby it is important to firstly expand trade vehicle’s that will eventually lead to the…

  23. Contd: development or the aids to trade. Starting with the aids to trade without improving actual trade modules simply make the aids to trade irrelevant because they will have no purpose to serve without actual trade taking place. Industrialisation, agriculture, manufacturing, power generation and tourism should have been your priorities first not roads and buildings. The roads and buildings are wasting away or wearing out as we speak the time the economy will improve you will need funds again to work on the damaged roads and rehabilitate buildings beginning another cycle of expenditure. Hospitals and schools as well as toll gates are alright.

  24. The tone sounds like someone has told him he’s the next president. Are you prepared for heartbreak, mulumbwana??? Vo lila lila sitifuna…

  25. @Rowdy, You have hit the nail on the head.. Priorities.. Priorities, Priorities…Zambia needs income generation ventures or policies that maximise the natural resources revenue (Where is the gold,emeralds produced by these mines?). Its unbelievable that some mines were bought for a song and they keep smiling to the banks while Zambians who own these resources are in abject poverty.. UBUNGA should no longer be a political tool to appease the hungry Zambians.

    • Good infrastructure be it roads or buildings are a prerequisite for efficient business. Just take a look at the revenue being racked in by the toll gates. If properly managed, road maintenance will be taken off the treasury and that will free monies for other socioeconomic activities. Copper from the copperbelt to either Durban or Dare-salaam now takes 7 days or less whereas with rail or bad roads it could take anything between two weeks and a month.

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